Read: 350
Credit cards and loans are essential financial tools that can help you meet your needs, particularly when making large purchases or when you lack sufficient cash. Banks and other major financial institutions offer a wide range of credit facilities in Singapore to cater to individual requirements.
Types of Credit Facilities Avlable:
Revolving Credit offers borrowers the ability to continue utilizing a certn credit limit without additional interest charges as long as payments are made on time.
Secured Credit Cards: Typically, these require collateral or a time deposit account opened with the bank for security.
Unsecured Credit Cards: Do not demand collateral but often rely heavily on factors like annual income for determining credit limits. Some card issuers may temporarily increase your credit limit to cover extraordinary expenses such as weddings, funerals, or hospitalization.
cash advances unless absolutely necessary; they can significantly impact your credit score over time.
On the other hand, loans provide a lump sum that is repd through fixed monthly installments over a predetermined period. They are often used for big-ticket items not easily covered by cash alone, such as mortgages, vehicles, or personal loans.
Mortgage Loans and Vehicle Loans are typical examples of financing options avlable in Singapore, typically accompanied by interest rates. Be aware that some mortgage loans may experience increased interest rates post-lock-in periods.
Responsibility in Borrowing:
Borrowing beyond your capacity to repay can lead to financial strn. Continuously using credit or borrowing for lifestyle expenses might accumulate debt more rapidly.
Before applying for additional loans or credit facilities, consider existing loan obligations and evaluate your current financial position carefully.
Do thorough research and clarify all doubts with lers before committing to any new loans.
The Credit Score Impact:
A good payment history builds a positive reputation in your credit report. Timely and full payments every month can prevent the accumulation of unnecessary fees like late penalties or interest charges, which could worsen your debt situation.
Tips for Managing Your Credit Report:
Align Billing Cycles: Ensure all existing credit facilities have the same billing cycle to avoid missing deadlines.
Schedule GIRO Deductions: Automate payments directly from your bank account to avoid delays and additional fees.
Mntn Minimal Credit Cards: Keep only necessary cards; cancel excess accounts.
Mntning a strong credit reputation can facilitate easier loan applications in the future, especially during unexpected financial situations like medical bills or funeral expenses.
Where to Check Your Credit Report:
You can purchase your report from Credit Bureau Singapore or view a sample version online.
Stay connected with us on Facebook and LinkedIn for more helpful content and tips on managing your credit responsibly.
Contributed by Credit Bureau Singapore
Published July 22, 2022
This article is reproduced from: https://ccs.org.sg/articles/ccs-220722/
Please indicate when reprinting from: https://www.669t.com/Loan_credit_card/credit_and_loans_guidance_SG.html
Credit Card Revolving Credit Limit Secured Unsecured Credit Cards Comparison Loan Types: Mortgage Vehicle Financing Avoiding Cash Advance Pitfalls Managing Credit Score with Repayment Online Credit Report Access Strategy